Sensex, Nifty trade in the red, Reliance Industries down by 1.36%

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Domestic benchmark equity indices opened tepid on Monday tracking Asian peers that fell after US stocks settled lower for a fifth straight trading session as the latest Covid-19 wave fuel growth worries. In opening trades, Sensex slipped 149 points or 0.26% to 58,155 while the Nifty 50 index was quoting at 17,327 as it declined 41 points or 0.24%.

“There are mixed signals for the markets at the start of the week. On the positive side, both FIIs and DIIs were bought last Thursday and the futures market also indicates FIIs going long. However, news from the US and Europe indicate a slowing down of the economy impacted by continuing restrictions on economic activity triggered by the new waves of the pandemic. Developed markets have turned slightly weak on these negative developments,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

The Mid-cap Index has staged a comeback this month outperforming the Nifty. But investors should refrain from jumping into the broader market since risk in the segment is on the higher side, Vijayakumar added.

Gainers and losers

Sectoral strand

Sectoral indices on the NSE opened mixed. Nifty Metal advanced the most by 0.65%, followed by Nifty FMCG index gained 0.11%. While Nifty Realty and Nifty Auto indices were trading with marginal gains of 0.02% or 0.01%, respectively.

On the downside Nifty IT index declined 0.49%, Nifty Bank fell by 0.40% and the Nifty Pharma index was down 0.15%.

Broader markets

The broader markets were trading flat taking cues from benchmark indices. The BSE MidCap index was up marginally by 5 points or 0.02% to 24,710 after scaling to a new peak of 24,742 in early trades. Likewise even the BSE SmallCap index touched a new high of 27,732 in morning trades.

The market breadth remained in the favour of bulls as 1,379 shares advanced compared to 995 declining and 166 remained unchanged.

Global markets

Overseas, Asian stocks traded lower on Monday, with stocks in Hong Kong leading losses. Chinese technology stocks were under pressure after a report that China is seeking to break up Ant Group Co’s Alipay and create a separate app for its loan business. Trade tension is also in the spotlight again after the Biden administration was said to be reportedly weighing a new probe into Chinese subsidies.

Elsewhere, North Korea said it successfully test-fired a new type of long-range cruise missile, ratcheting up tensions on the Korean Peninsula. Wall Street ended lower on Friday as investors weighed signs of higher inflation, while Apple Inc tumbled following an unfavourable court ruling related to its app store.

Looking ahead for the week, the US consumer price index for August is set to be out on Tuesday, while retail sales figures stateside are expected Thursday. A slew of Chinese economic data, including retail sales and industrial production for August, is also set to be out on Thursday.